Labour actually is not working: Unemployment ranges are already dangerously excessive – and are set to worsen, warns RUTH SUNDERLAND

Labour has little idea of who working people are, and even less of a clue how to look after their interests.

Rachel Reeves, under pressure from the left of her party, has pursued an agenda of punishing those earning moderately decent salaries and, therefore, not classed as ‘real’ workers.

At the same time, her increases in employers’ National Insurance and the minimum wage have deterred firms from hiring, as has former Deputy Prime Minister Angela Rayner’s workers’ rights bill, which has just been passed by the House of Lords.

Evidence of the harm created is plain to see. Unemployment was 5.1 per cent in the three months to October – the highest since 2021. Payroll numbers fell by 38,000 in November.

The rate of economic inactivity, which measures the number of working-age people not in the labour force – whether through sickness, caring responsibilities, early retirement or simple demotivation – is down a bit, but still dangerously high at 21 per cent.

A figure of one-in-five working-age people living in idleness, enforced or by choice, is not sustainable. 

Jobs crisis: Unemployment was 5.1% in the three months to October, the highest level since the height of the Covid pandemic in 2021

Around 2.8m are not employed due to long-term sickness. The state of the NHS and a strike by resident doctors won’t help.

Wage growth overall has slowed, which may keep a lid on inflation.

This has bolstered hopes of a quarter-point rate cut by the Bank of England on Thursday. In the public sector, however, pay growth at 7.6 per cent strongly outpaced that in the private sector, which keeps the welfare state afloat.

This is normally the time of year when there are at least some seasonal opportunities for work in retail and hospitality.

The latter industry, however, is reeling under so-called business rates ‘reform’, touted as a fairer system that has led to many paying more.

As we have reported on these pages, thousands of village pubs which can ill-afford another big bill are to be hit by the levy for the first time. 

The numbers of young people not in education, employment or training hover around one million. Traditionally, many would get their start in hospitality or retail – sectors that are in the firing line.

On top of that, there are more young people coming out of university than there are graduate-level jobs available, a situation likely to get worse as AI advances.

Labour really isn’t working.

Spinning around

Is this the beginning of the end for the urbane maestros of City PR?

Pathos Communications, founded by Omar Hamdi – whose eclectic career includes a spell in stand-up comedy – listed on AIM yesterday, billing itself as a disruptor of the traditional PR model in which clients pay hefty retainers for the services of spin-meisters.

At Pathos, payment is by results, defined as securing media coverage.

Its target clients are small businesses, largely in North America, seeking exposure in local outlets.

It is welcome to see a young British company coming to market, particularly on AIM, which badly needs a lift.

Like many financial journalists, I have often wondered how City PR firms set their fees and how clients assess value. 

This model may open the door to limited services for small companies that would otherwise be priced out.

But it is no substitute for seasoned counsel when a business faces, say, a cyber-attack or an unwanted bid.

The titans of City PR will not be losing much sleep just yet.

Peace dividend

A credible peace deal between Ukraine and Russia could provide a boost to shares in infrastructure, housing, transport and energy – sectors investors are increasingly eyeing as alternatives to tech.

Oil and defence stocks dipped on hopes that a deal might be struck.

Yet reconstruction costs are already estimated at $524billion, and rising – a formidable pipeline of opportunity.

CRH, the Irish former FTSE 100 building materials group now listed in the US, has acquired cement plants in Ukraine, while others are quietly surveying the terrain.

The word ‘credible’, however, does the heavy lifting. Much depends on the terms of any settlement and whether it appears durable.

Perhaps best not to sell those defence shares just yet.